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| |

 

IE 3265 POM
Slide Set 9
R. Lindeke, Sp 2005
ï
 
 

h | Materials Requirements Planning). MRP is the
basic process of translating a production schedule for
an end product MPS or Master Production
Schedule) to a set of time based requirements for all
of the subassemblies and parts needed to make that
set of finished goods.

h Œ
Œust-in-Time. Derived from the original Œapanese

Kanban system developed at Toyota. ŒIT seeks to
deliver the right amount of product at the right time.
The goal is to reduce WIP  ork-in-process)
inventories to an absolute minimum.
ÿ|
 | 
h MRP is the classic =
 system. The MRP system
computes production schedules for all levels based
on forecasts of sales of end items. Once produced,
subassemblies are =
 to next level hether
needed or not.

h ŒIT is the classic =  system. The basic mechanism

is that production at one level only happens hen
initiated by a request at the higher level. That is, units
are =  through the system by request.
 


h These methods offer t o completely different approaches to basic

production planning in a manufacturing environment. Each has
advantages over the other, but neither seems to be sufficient on
its o n. Both have advantages and disadvantages, suggesting
that both methods could be useful in the same organization.

h Main Advantage of MRP over ŒIT: MRP takes forecasts for end
product demand into account. In an environment in hich
substantial variation of sales are anticipated and can be
forecasted accurately), MRP has a substantial advantage.

h Main Advantage of ŒIT over MRP: ŒIT reduces inventories to a

minimum. In addition to saving direct inventory carrying costs,
there are substantial side benefits, such as improvement in quality
and plant efficiency.
 

  

Advantages Disadvantages
ŒIT å PULL
Every job is a µHigh Stress¶ Rush
Limited and kno n Final Inventory
order
Worker only consume their time &
ï  
 systems MUST be in
Ra Materials on hat is actually
place
needed
Setup times ill greatly impact
Quality 
be High ± each piece throughput
has a definite place to go ± else ‰
problem ill lead to unhappy
immediate feedback is given customers either internal or
external)
  

  

Advantages Disadvantages

MRP å PUSH
Allo s Managers to manage ± that
Can lead to large inventories
is, plan and control things
Requires intricate kno ledge of Can generate large quantities of
Production Times & Product Flo scrap before errors are discovered
Can lead to economies of scale in Requires diligence to maintain
purchasing and production effective product flo
Allo s for the planning and
completion of complex assemblies Requires maintenance of large and
as sub-components are delivered complex databases
only by scheduled need

Œ

h ŒIT Œust In Time) is an outgro th of the Kanban system developed by
Toyota.
h Kanban refers to the posting board and the inventory control cards
posted there) here the evolution of the manufacturing process ould
be recorded.
h The Kanban system is a manual information system that relies on
various types of inventory control cards.
h It¶s development is closely tied to the development of SMED: Single
Minute Exchange of Dies, that allo ed model changeovers to take
place in minutes rather than hours.
h The Fundamental Idea of ŒIT ± and Lean Manufacturing Systems in
General an Americanization of the Toyota P. S.) ± is to empo er the
orkers to make decisions and eliminate aste herever it is found






Œ



h Empo er the orkers:

h Workers are our intelligent resources ± allo them to
exhibit this strength
h Workers ultimately control quality lets them do their job
correctly Poka-Yoke)
h Don¶t pit orkers against each other ± eliminate ³piece-
ork´ disconnected from quality and allo orkers to
cooperate in teams to design jobs and expectations






Œ



h Eliminate Waste
± Waste is anything that takes a ay from the operations
GOAL to make a profit and stay in business!)
h Reduce inventory to only hat is absolutely needed
h Improve Quality ± scrap and re ork are costly and disrupt flo
h Only make hat is ordered
h Make setups and changes quickly and efficiently
h Employ only the orkers needed
h Eliminate Clutter ± it astes time



Œ




!

  

   


Advantages:
1. Decreases Inventory Costs
2. Improves Efficiency
3. Reveals quality problems see Figure 7-10)

Disadvantages:
1. May result in increased orker idle time
2. May result in decreased throughput rate

 
  

  
  

Œ



Revealing fundamental µproblems¶ is the noted

competitive advantages of ŒIT/Lean



Œ



  


Ñ

 
 !


  


1. Efficient tracking of lots
2. Inexpensive implementation of ŒIT
3. Achieves desired level of WIP ± based on Number of
Kanbans in the system


  


1. Slo to react to changes in demand
2. Ignores predicted demand patterns beyond 2 months
or so)



  

h Typically it is a 2-card system

h The P production) Card and W  ithdra al) Card
h Limits on product inventory number of P & W cards)
are set by management policy
h The count is G


  until problems
surface
h The actual target level card count) is based on short
term forecasting of demands



  



  ! 
"#


  


h P cards cycle from their accumulation post at Center

1 to product  hen a defined trigger point is reached)
and then to output queue
h When trigger level is reached, Ct 1 orker pulls
product from Ct 1 Wait point queue and replaces the
Ct 1 W-cards ith Ct 1 P-Cards hich then are
loaded to the Ct 1 processors ± the orker puts Ct 1
W-Cards to his/her acc. Post for W-cards
h Finished Product is pushed into the Ct 1 output
queue



  ! 
"#


  


h A second orker Ct 2¶s orker) atches for accumulation of Ct

2 W-Cards
h When it reaches their trigger level, he/she pulls product into Ct
2 Holding area after replacing Ct 1 P-Cards ith their W-Cards
± and returns Ct 1 P-Cards to their Acc. Post for Ct. 1 orkers
benefit
h They also atch for accumulation of Ct. 2 P-Cards on their acc.
Post and hen trigger count is reached they pull product from
holding area and replace Ct 2 W-Cards / Ct 2 P-Cards then
push it into the processors
h And around and around they go!



  

h So ho many cards?
± speaking of hich, a ð þ


card is associated 
ith a container lot) 
O



of product so the

O

 


number of P & W
cards at a station 
O

O
 O  
determines the 
O




O
inventory level of a
product! O
 !




O
O
"
#
 !

O





  

h Lets look at an example:

h 950 units/month 20 productive days) ĺ 48/day
h Container size: a = 48/10 = 4.8 ĺ 5
h ³L´ data:
± A. setup is 45 minutes .75 hour)
± B. Setup is 3 minutes .05 hr)
± Wait time: .3 hr/container
± Transport time: .45 hr/container
± Prod Time: 0.09 hr/each = .45 hr/container



  
La > „
„
„ „
> „
hr Requires 3*2 = 6*5 = 30
pieces in inventory ± also,
D >    >   hr
ith 45mins set up 10 times
DLa > 
„
> „ wa > „
„ > „ a day means that e
consume 450 min or 7.5
„ „ hours/day just setting up!
a > >
„
 > 


Lu > „
„
„ „
>  „

h r
Here only 2*2 = 4*5 =
D L u > 
 „

>  „
20 pieces and also
only .05*10 = 50 min
w u > „
 „
> „
for setup .833 hr) per
 „
„
day
u > >  „
>

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h Lets look at the effect of

studies comparing cost of Ñ| hQ
setup vs. inventory cost ±
G ßQ Ñ > Ga ßÑ
like EOQ Q

h Then lets see hat e can O
O
$%&

invest to reduce inventory
levels 
 
 
O


' 


h We ill spend money on
reducing setup cost time) 

O  O 
O


and see if reduced
inventory ill offset our
investment  O
 
 
 

h This is the driving force for
SMED (

 
|
   

h We can effectively model this ³aK)´ function as a

µlogarithmic¶ investment function
h By logarithmic e imply that there is a an increasing
cost to continue to reduce setup cost
h We state, then, that there is a sum of money that can
be invested to yield a fixed percentage of cost
reduction
h That is for example) for every investment of $200
the organization can get a 2% reduction in Setup
cost

 
|
   

h Lets say that the investment is $ü

buys a fixed percent reduction in  ß G 
*
*
ü
K0
h If e get actually get 10% setup *
O




O 
cost reduction for $ü, then an
investment of $ü ill mean: )
O

O
)O



± Setup cost drops to: 0.9K0


O

*ü

h A second $ü investment ill lead
to a further 10% reduction or: O 
O
+
± .9K-.1*.9K = .81K0
h This continues: K3ü = .729K0 ),-! 
 
O
h Generalizing:

 
|
   

h With that ³shape´ e

can remodel the aK) ü
logarithmically: u>
h aK) = b[lnK0) ± lnK)]
   
h here:   

h Reverting back to Ë ß
 | h þ
u        ß 
GQ,K) function ± and .
OOO/
" ""

substituting Q*:
O+
0

,


 
|
   

h Finding the K* after the minimization:

u

|h
2
O
1233




h To determine hat e should do, determine GK)

using K0 and K*


 
&

h K0: $1000
h ü: $95 for each 7.5% reduction in setup cost
h Annual quantity: 48000
h Holding cost: $4.50



h MARR is 13% u 
„


   „
  
 ß  „


߄
ß
„


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„

  &

h Investment to get to K* a -Ñ > 

„

  ß  ߄


> 
„
Testing for decision
Ë ß 
 | h 
 „
h No investment K = K0):
 |
 
    
h


ß
Ë 

| h þ   

h At Min K*:
   „
 þ  

„    

  ß


| 
h
'



&

h SMED = single minute exchange of dies

hich means quick tooling change and lo
setup time cost)
h Inside Processes
setup functions that
must be done µinside¶ the machine or done
hen the machine is


h Minimally these ould include unbolting departing
fixtures/dies and positioning and bolting ne fixture/dies
to the machine




&

h Outside Setup
activities related to tooling
changes that can be done µoutside¶ of the
machine structure
± These ould include:
h Bringing Tooling to Machine
h Bringing Ra Materials to Machine
h Getting Prints/QC tools to machine
h Etc.

'

h When moving from ³No Plan´ or Step 1 to

Step 2 separating Inside from Outside
activities) investments ould be relatively lo
to accomplish a large amount of time cost)
saving
± Essentially a ne set of change plans and a small
amount of training to the Material Handlers so that
they are alerted ahead of time and bring the
tooling out to the machine before it is needed
 
( 
)

h Require investments in Tooling

h Require Design Changes
h Require Family tooling and adaptors
h Require common bolstering attachments
h In general requiring larger and larger
investments in hard are to achieve smaller
and smaller time cost) savings in setup




$"
 
'
&

In reality the essence of

a Logarithmic setup
reduction plan!


# 
ï   

h This is a process to optimize the assignment of

individual tasks in a process based on a planed
throughput of a manufacturing system
± It begins ith the calculation of a system ³Takt´ or
Cycle time to build the required number of units
required over time
± From takt time and a structured sequential analysis
of the time and steps required to manufacture
assembly) a product, compute the number of
stations required on the line
± Once station count is determined, assign feasible
tasks to stations one-at-a-time filling up to takt time
for each station using rational decision/assignment
rules

ï   

h Feasible tasks are ones that have all

predecessors completed or no
predecessors) and take less time
that the remaining time at a station
h Feasibility is also subject to physical
constraints:
h Zone Restriction ± the task are physically
separated taking to much movement time
to accomplish both ithin cycle like
attaching tires to front/back axles on a
bus!)
h Incompatible tasks ± the Grinding/Gluing
constraint

 
   
&

h Takt Cycle) Time:

'  "
O  4
4O
-
  
4
Ô> >
4 
   


%  
&

Ô>
O  O

Q
h Minimum # Workstations req¶r:

 >

4
5
4 
4O
Ô
' 
    
&

 >

  >  >
Ô G
 
 O O
 
O
 
 

 
O



* >
*


Ñ >
Ô
 (
O
 
O

 
 
 
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6




*
&

Times:
A 25s; B 33s;C 33s;
A B C D 21s; E 40s; F40s;
G 44s; H 19s
Production
Requirement G H
is 400/shift

D E F
   
# 

%*  
   

 Ü „
 

„
Ô> > > „
   „ 
 

>

 ß


>
  
   
> „
Ô „
 ¢
a

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&

h Primary Rule:
± Assign task by order of those having largest
number of follo ers
h Secondary Rule:
± Assign by longest task time
| 


  

Task # Follo ers

A,D 4

E,B 3

F,C 2

G 1

ï   




Feas. Task /
Remaining Task / L.
Station Task T. Time Remaining Most
Time Time
Task follo ers
A 25 38.4 B, D D B
1
D 21 17.4 -

2 E 40 23.4 -

3 B 33 30.4 -

4 F 40 23.4 -

5 C 33 30.4 -

G 44 19.4 H
6
H 19 .4 -



ï  

A B C

WS 3 WS 5

WS 1 G H
WS 6

D E F

WS 2 WS 4

#' 
 

&



G   „



 
„
„





„
„



 
„

" ' 
 



h We investigate other Rules ± application to improve

layout
h 1st by follo ers then by longest time then most follo ers
h Alternating!
h Consider line duplication if not too expensive!)
hich lo ers demand on a line and increases Takt
time
h The problem of a long individual task
h In Koeln, long time stations ere duplicated ± then the system
automatically alternated assignment bet een these stations